Schenker to Shut Sorting Hub In Toledo, Cutting 700 Jobs

DB Schenker USA, the logistics company that ranks No. 4 on the Transport Topics Top 50 list of the largest logistics companies in the United States, Canada and Mexico, announced on July 22 that it is closing a domestic freight sorting hub in Toledo, Ohio, and shifting contractors to move its cargo, a step that cost 700 people their jobs.

The closing, announced July 21, also will include a change in the company’s strategic focus to serve what the statement said was “a smaller number of customers who require North American domestic transportation solutions.”

In the statement, DB Schenker didn’t say how many customers the company would continue to serve or how many it has today in the United States. “DB Schenker’s substantial international air, ocean, contract logistics and warehousing operations remain fully supported and unaffected by today’s announcement,” the company said in its statement.

“Our employees represent the cornerstone of our company, and we will treat all affected personnel in an open, transparent and respectful manner throughout this transition,” said Heimer Murmann, CEO of Schenker Inc., based in Berlin, Germany.

Schenker said the air fleet, which represents under 10% of its business in the Americas, will be phased out in “the next several weeks.” Schenker is a unit of Deutsche Bahn, the rail operator.

The move is a response to what Schenker called “changing marketplace conditions.” Murmann said “as a result of the prolonged recession and spiking fuel prices, more and more of our customers are opting for expedited ground-based solutions instead of domestic air freight, and they are looking for partners who can provide transportation management services rather than transactional transportation.”

“We deeply regret that there will be some layoffs as part of this realignment,” he added. “We are working to redeploy as many employees as possible to other parts of our business.”